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On Wednesday, the GBP/USD pair briefly jumped above the key 1.40 psychological mark after data released from the UK showed wages grew 2.5 percent in the three months to December, which reaffirmed BOE policymakers' view about strengthening earnings growth. The positive wages data, to some extent, got negated by an unexpected rise in the UK unemployment rate, for the first time in almost two-year, and prompted some fresh selling around the British Pound.

Even during the NY trading session, the FOMC meeting minutes-led knee-jerk bullish spike was sold into and the pair subsequently dropped to a 6-day low during the Asian session on Thursday. The GBP bulls now look forward to the second estimate of the UK GDP figures for the last quarter of 2017. Against the backdrop of uncertainty surrounding the upcoming Brexit talks, any reaction to better-than-expected UK data is likely to be short-lived and the pair seems more likely to extend its near-term depreciating move.

Even from a technical perspective, the pair is placed near an important support near the 1.3900 handle, marking 50 percent Fibonacci retracement level of 1.3458-1.4345 up-move. With short-term technical indicators gradually drifting into bearish territory, a convincing break below the mentioned support would turn the pair vulnerable to slide further toward 61.8 percent Fibonacci retracement level support near the 1.3800 round figure mark en-route an important horizontal support near the 1.3765-60 region.

On the upside, any recovery attempts now seem to confront immediate resistance near mid-1.3900s and any subsequent up-move might continue to be capped at the 1.40 handle.